Saul Centers Inc's Dividend Analysis
Assessing the Sustainability of Saul Centers Inc's Upcoming Dividend
Saul Centers Inc (NYSE:BFS) recently announced a dividend of $0.59 per share, payable on 2024-01-31, with the ex-dividend date set for 2024-01-12. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into Saul Centers Inc's dividend performance and assess its sustainability.
What Does Saul Centers Inc Do?
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Saul Centers Inc is a self-managed real estate investment trust which invests in, operates, and develops retail and commercial properties. The company's portfolio includes community and neighborhood shopping centers, office properties, and mixed-use properties. Properties are primarily located in the Washington, D.C. and Maryland metropolitan areas. Saul Centers operates through two business segments: shopping centers, which contribute the maximum portion of total revenue; and mixed-use properties. Major tenants include grocery stores, discount department stores, and drug stores.
A Glimpse at Saul Centers Inc's Dividend History
Saul Centers Inc has maintained a consistent dividend payment record since 1993, with dividends currently distributed on a quarterly basis. Saul Centers Inc has increased its dividend each year since 2010, earning it the status of a dividend achiever, a prestigious recognition for companies with at least 14 consecutive years of dividend increases.
Below is a chart showing annual Dividends Per Share for tracking historical trends. Unfortunately, the chart image is not currently available.
Breaking Down Saul Centers Inc's Dividend Yield and Growth
As of today, Saul Centers Inc currently has a 12-month trailing dividend yield of 5.85% and a 12-month forward dividend yield of 5.85%, indicating an expectation of stable dividend payments over the next 12 months. Over the past three years, Saul Centers Inc's annual dividend growth rate was 3.10%, which decreased to 2.20% per year over a five-year period. However, the company's annual dividends per share growth rate over the past decade stands at 5.10%.
Based on Saul Centers Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Saul Centers Inc stock as of today is approximately 6.52%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. As of 2023-09-30, Saul Centers Inc's dividend payout ratio is 1.41, which may raise concerns about the dividend's sustainability.
Saul Centers Inc's profitability rank is 7 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported positive net income for each year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
For dividend sustainability, robust growth metrics are essential. Saul Centers Inc's growth rank of 7 out of 10 suggests a good growth trajectory compared to competitors. However, Saul Centers Inc's revenue has seen an average annual decrease of -10.30%, underperforming approximately 87.22% of global competitors.
The company's 3-year EPS growth rate increased by approximately 1.30% per year on average, underperforming approximately 51.24% of global competitors. Additionally, the company's 5-year EBITDA growth rate of -0.60% underperforms approximately 57.55% of global competitors.
Concluding Thoughts on Saul Centers Inc's Dividend Prospects
Considering Saul Centers Inc's dividend payments, growth rate, payout ratio, profitability, and growth metrics, investors should weigh these factors carefully. While the company has a strong history of dividend payments and a good profitability rank, the payout ratio and some growth metrics raise questions about the long-term sustainability of dividends. It is essential for investors to consider whether the current yield compensates adequately for the risks identified.
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This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
